The world of work, looks very different today than five years ago….
What’s the best way to recruit, retain & engage staff in a turbulent and troubled economic climate? And why is there such a war for talent in the European software industry? In our upcoming “Making Waves” podcast we look at what companies need to do to retain and engage their staff following the years of upheaval caused by the COVID pandemic. Also, what role does the employer have, in the near term, in supporting their employees when there is a “cost of living squeeze” as we are seeing now across Europe.
Finding people with the right skills to work in the software sector has been a challenge since the industry's infancy in the 1980s. Computing and how it was taught in school has been controversial. Far fewer girls or people from diverse backgrounds go on to study the topic at university, and those in the talent pool tend to be snapped up by firms with the deepest pockets. Retraining people or outsourcing to countries such as India, who do have a highly technically trained workforce have been solutions for some, but it hasn't solved the underlying issue. Why is this still such an issue in Europe?
Abakar , Founder & CEO of Beamery says:
“Every company is now a technology company. You know, even your milkma
n is a technology company, which means that businesses are looking for skills that they didn't need before and they're looking for them at a faster iteration. Whereas reskilling in a business or a change of job would happen every 10 to 15 years, now It happens every two to three years. And so, I think that the question around skills has become so important because now people are really paying attention to what people need to be able to do (what are their skills) rather than the typical progression around experience and career”
Chano Fernandez, Co-CEO of Workday added:
I think it’s about how we increase the size of the talent pool. And, of course, having that intent (to be inclusive and support diversity), setting targets and being committed in the long term is tremendously relevant because it's not going to get sorted out overnight. At Workday we look into how we open all those talent pools, identifying skills, really investing in people getting those skills. Women that have been out of jobs, because they've been taking care of families for a very long time or in the USA, veterans that are coming out of the military service, or people that just come from underserved or underrepresented backgrounds that have not had great opportunities, but have a great attitude (and the attitude will determine their altitude) in terms of, how much they can achieve. So, you really give them an opportunity and you invest, you train.
But there is sometimes a feeling that some of the tech giants are hiving off the top talent just because they've got the deepest pockets they can pay more money, for these really skilled workers. And that's having a knock-on effect to start-ups who just can't compete with the financial incentives.
In our podcast episode, our guests discuss compensation incentives as a reason for people joining a particular company, but they also identify other factors, such as a company’s culture, how they take care of their employees and the working environment also playing key parts in whether a person is attracted to join a business.
“We're usually pretty good in terms of, attracting and developing the top talent and retaining them because we put in place our core values and our number one is taking good care of our employees. That's important right now, of course, compensation, as I said, is an important element. But trust me, it is not the only one”.
Before a company can start incentivising a potential employee to join the company, they first need to find the right people with the right skills. Does the talent pool problem start with how technology has and is being taught in schools? Do we need to completely overhaul the education system? Or do we need to come at this problem a different way and think about just upskilling people when they're actually in the industry?
Abakar points out:
“There has been lots of initiatives, at least in the UK and in the US around bringing in things like coding and technology earlier into schools. I think the bigger question, which is ingrained is what are the available careers and expected careers that people follow? Because, for example, 10-15 years ago, becoming a software engineer wasn't cool, suddenly, it is cool. I think the bigger question is what is the transition from early stage of education to late stage? And what are the critical skills that you get taught?”
“There are now a lot of opportunities to learn coding, and they are starting earlier at schools. But you need to balance this with the right level of maturity and creativity so that the kids enjoy it. And, I think, we need to invest as well in preparing some of the teachers in order to do it right because it is evolving so fast”.
With all the above challenges aside, the world as we knew it stopped suddenly in March 2020 when the COVID 19 pandemic swept across the globe, forcing us to change the way we lived and worked.
Now, as we emerge from that crisis, people are demanding change. They are reassessing their work life balance, some finding it wanting. Others have question whether they want to live in expensive suburbs or city locations where their workplaces are located. More are questioning whether they want to commute daily, while some are simply changing careers or giving up work completely, known as the ‘great resignation’. And all this means businesses face tough decisions, should they allow hybrid working? What should that look like to ensure corporate culture and team work remain? Does the four-day week make sense? Or should we return to the daily grind as we knew it in 2019.
Anastasia Leng, CEO Creative X:
“We have fundamentally changed the way we work. One of the things that we we did, for example, is during COVID, we moved the company. Obviously, everyone had to experiment with working remotely, that was something we all went through on a global level. But I spent a lot of time talking to people on the team. I remember mid COVID, I was having these conversations, and I just felt this deep sense of fatigue from everyone on the team, which is very strange, because we're not like a burnout kind of culture, we do have a long-term greedy culture, once we get you in, we want you to stay here for a really long time. And we decided it was because, people were stuck in their house and they had nowhere to go, all these outlets for recharging your battery just weren't available, we decided to experiment with a four-day workweek”.
As a result, Anastasia introduced a more flexible way of working, however, not only did Anastasia sense fatigue amongst her staff during Covid, but has also recognised this is still ongoing.
“Businesses aren't responsible for some of these changes, but I think they will bear an unfair amount to blame for the things people feel because, at the end of the day, if your salary carries less spending power than it did a year ago, it's not the employers’ fault, but who are you going to blame? Who else do you have to blame? And I don't know how to navigate that other than to continue to be transparent about how we're approaching this and making decisions”.
We're facing a very different looking workplace, post pandemic. Software companies are the same as many other companies, insofar as they're seeing people wanting to leave for various reasons. Some people just want a different work life balance. Some people maybe have long COVID, some people just want to change things having had their lives disrupted for two years, going back to the status quo just doesn't seem like the right thing to do. So how big an impact is this having on companies that are looking to retain their skilled workers?
Chano pointed out:
“Employees are looking for the best of everything, right? They're looking for flexibility, but they also want to ensure that they can have a place where they can grow and they can enjoy with their peers, and they can network. So, it’s how you, as a company, understand how you can provide that flexibility mixed with productivity in order, for example, to support and on board the new employees, it is important that, you foster connections and you foster collaborations and you'll get people together for those moments that matter”.
Videoconferencing became the new norm during lockdown for businesses and, since the pandemic, these online facilities are still heavily used and it has offered people the option of flexible remote working, but where is the balance between wanting to work from home, wanting to work from the office, but also, as an employer, keeping people connected for those moments that matter? How do you get that sort of balance right, so that everybody's happy?
“So, there's been kind of an interesting thing that's happened over the last five years, which is a combination of a few things. One is obviously we've had COVID, so we've demonstrated we can work remotely, the other is in a new generation, Gen Z has been entering the workforce. And I think the third element is around, we've had to learn how to operate differently and learn different productivity skills we didn't have before. And so there's been a few interesting pieces of fallout from this, which is, in the first two years in COVID, people really optimised for the individual - what do I need? What do I want? How do I work? And I think what Chano has been touching on, which I completely agree on, is the evolution companies are now going through is not an I, it's a we - how do we work?”
The challenge of managing a hybrid workforce and dealing with a disconnected and perhaps demotivated individuals, following the pandemic, is probably something many CEOs have been trying to navigate, but how can they be supported?
With the new Gen Z entering the workforce, is it particularly hard for these people to learn from their superiors if they’re not in an office? How does a hybrid working environment impact these young people that are coming into jobs and what can employers be doing to better prepare themselves?
“We've been looking at learning from companies that have been working in this way since even before COVID. So, for example, remote is not a brand new thing, it's just become something that's more prevalent. And so, when you look at the way that remote first companies operate, and you know, there's some great examples, companies like GitLab, for example, that have been doing this since the beginning. And what they do is they really focus on quality of documentation, quality of education and quality of employee onboarding, because they recognise that you need to backfill for this idea of inhuman spontaneity and osmosis, and you need to be very intentional and very deliberate, which means that any company that is operating in a hybrid world needs to learn from the remote first companies and needs to make sure that the learning and onboarding and upskilling is not accidental. It's very intentional”.
Our podcast guest, Chano, agrees that adequate education and preparation is needed for employers to be in a position to manage in this “new world” of hybrid working, but also points out the importance of connecting…
“I feel that mental health is one of the challenges we, as a society, are facing, I believe getting people interacting in person helps to potentially avoid some challenging mental health problems. When you're just working, always 100% completely remotely not saying that, that's not viable, definitely it is and there are companies proving it is. But I believe that it helps out to get together in the office, , because at the end of the day, we are social animals, right?”.
We all know of offices famous for having games rooms, massage chairs and one even having a slide that goes down into their cafeteria! Perhaps a clever way to entice employees to stay working late, perhaps a fun way to keep spirits up and inspire creativity, but are offices really the right place to be inspired? Do we all need to put slides in our offices and make them more fun? Or do we need to accept that actually, the best ideas come when you're walking in the woods or going for a swim? And actually, offices are not the most creative places?
“if you can do most of your job from home, why would you come into the office, and what would be the reason you'd come into the office? It isn't to sit on phones, it isn't to sit on laptop, it's to work together, collaborate, etc. And so, we invested heavily into creating a space where people would want to come in to do things they can't do from home”
“I think you're going to see different models and different flavours in terms of creating the best space where people can collaborate, can get to know together and basically can create trust, because, at the end of the day, when you see really functioning, working teams, it’s because they trust each other”
In addition to the challenges of finding and retaining talent as well as dealing with a global pandemic, we are now faced with an additional concern, the cost-of-living crisis. Do businesses have a responsibility to help employees who are struggling to manage their household budgets and, if so, what shape that responsibility should that take?
“I think, as an employer, you need to understand the full picture, and how this new momentum on a macro level is impacting on your employees. And then it's a question how you value them, how you factor that in into the review [KW1] cycles that you're doing. And those that are having a top potential, and you really want to keep you want to ensure that you provide that environment and you provide that full compensation package that makes things good to be here”
“It’s not just about salary, it's about the total compensation construct, including benefits, including travel, including health care. And so, I think, for every organisation, it really depends on their workforce”.
Abakar goes onto say…
“the responsibility I personally believe of the employer is, you are now in people's homes all the time - literally, so you're responsible. I think before providing health care, you're responsible for providing or thinking about mental health, thinking about whether people can afford to do the things because ultimately, the most productive employees are ones that are not worried about putting bread on the table. So, the ability to create and remove that mental strain, which means that if the markets have changed, whether it's through competitive pressure or through inflation, and people are feeling in their wallets, the organisation has a choice, they have a choice of either trying to help or potentially losing the employee to somebody else who is”.
We are taking a bit of a leap into the unknown. But that leap is a necessary one as people, wherever they are in the world and in whatever industry, simply want a different way of working in 2022. Those businesses who listen to their staff and come up with flexible ways of working are likely to be better at retaining their talent. As for recruitment, it sounds as if it's time to approach that from new angles to widening the pool of people you take on and being prepared to retrain them seem to be key themes.
Listen to the full podcast to hear more from our guests on these crucial issues.